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150 Cards in this Set

  • Front
  • Back
The primary use of environmental scanning is to:

A. identify threats and opportunities

B. Identify effective supply chains

C. Understand competitor's strategies

D. Understand current markets
A. identify threats and opportunities
All of the following are business strategy approaches EXCEPT:

A. Cost leadership

B. Product differentiation

C. Customer focus or niche

D. Marketing leadership
D. Marketing leadership
Which of the following strategy development approaches focuses on the root causes of specific situations?

A. Overview

B. Trade-off

C. Reductionist

D. sequential
C. Reductionist
An organization that has a distinct competitive advantage in a market can concurrently increase in both:

A. Market share and market size

B. Market share and profit margin

C. Market size and return on investment

D. Total profit and return on investment
B. Market share and profit margin
Quality of a product design is best determined by the:

A. Abscence of defects in the product

B. Conformance of the product to design specifications

C. Number of product features and options

D. Customer satisfaction with characteristics and features
D. Customer satisfaction with characteristics and features
Which of the following actions can concurrently improve flexibility and delivery consistency?

A. Reducing waste in processes

B. Hiring and developing specialists

C. Increasing product variety

D. Increasing capital investment
A. Reducing waste in processes
The definition of an organization's strategy should include which of the following?

A. Specific performance targets

B. Assessment of competitors strengths

C. Creation of competitive advantage

D. Product and marketing plans
C. Creation of competitive advantage
Which of the following is most likely to be an order-winning criterion for a commodity product?

A. Organizational image

B. Product design

C. Delivery speed

D. Product quality
C. Delivery speed
The most appropriate focus of the operations strategy is:

A. Survival of the organization

B. Development of competitive advantage

C. Competitive priorities

D. Cost of production
C. Competitive priorities
Reduction of which of the following is an element of the JIT approach?

A. Inventory level

B. Queue times

C. Quality prevention costs

D. Product mix flexibility
B. Queue times
A process focused layout would be most appropriate for the manufacture of:

A. Custom window coverings

B. Personal computers

C. Office furniture

D. Telephones
A. Custom window coverings
Fundamental operating decisions can be catagorized as:

A. Organizational design and skills matrix

B. Structure and infrastructure

C. Facility and process technology

D. Priority and capacity
B. Structure and infrastructure
A lead capacity strategy would be most appropriate for an organization that pursues which of the following as a competitive advantage?

A. Price

B. Quality

C. Delivery speed

D. Product image
C. Delivery speed
The purpose of product profiling is to determine the fit of:

A. Customer requirements and product features

B. Product volume and variety and deployment choices

C. Product lines and expected volumes

D. Product volumes and variety
B. Product volume and variety and deployment choices
All of the following are structure decisions EXCEPT:

A. Number of distribution centers

B. Deployment of new information systems

C. Purchase of a supplier of a critical component

D. Deployment of new process technologies
B. Deployment of new information systems
An increase in which of the following would most likely lead a manufacturer to replace distributors with its own distribution network?

A. Level of technical service required

B. Geographical markets served

C. Number of customers served

D. Product volumes
A. Level of technical service required
Which of the following is most likely to deter entrants in an industry with very short product life cycles?

A. Low profit margins

B. A large number of customers

C. Short delivery requirements

D. Large capital investments requirements
D. Large capital investments requirements
A lag capacity strategy would be most appropriate when:

A. Capacity must be added in large chunks.

B. Product life cycles are short

C. Demand is seasonal

D. Product volume is high
A. Capacity must be added in large chunks.
Which of the following is an infrastructure choice?

A. Process technology employeed

B. Number and location of plants

C. Organizational design

D. Capacity strategy employeed
C. Organizational design
The focus of education is on:

A. Transferring skills

B. Transferring knowledge

C. Changing individual behavior

D. Changing organizational objectives
B. Transferring knowledge
A centralized organization is most consistent with which of the following order winning criteria?

A. Delivery speed

B. Flexibility

C. Price

D. Quality
C. Price
Establising a bias for quality requires an organization to:

A. Pursue process improvements

B. Empower employees

C. Establish quality circles

D. Implement statistical process controls
A. Pursue process improvements
A manager who is committed to employee centered involvement typically will:

A. Inform employees of decisions

B. Tell decisions to employees

C. Seek employee input on decisions

D. Define limits for employee decisions
D. Define limits for employee decisions
Which of the following is best suited to solving major business process problems?

A. Quality circles

B. Cross functional teams

C. Ad hoc teams

D. Self directed work teams
B. Cross functional teams
Which of the following organizational structures is best suited to an organization that is seeking to establish flexibility as a competitive advantage?

A. Centralized and hierarchical

B. Centralized and horizontal

C. Decentralized and hierarchical

D. Decentralized and horizontal
D. Decentralized and horizontal
Which of the following is a focus of senior management in a horizontal organization?

A. Making operating decisions

B. Building staff functions

C. Removing obstacles to improvement

D. Ensuring consistency of operations
C. Removing obstacles to improvement
Quality function deployment (QFD) is a tool to improve the:

A. Quality of designs

B. Process capabilities

C. Product conformance

D. Process controls
A. Quality of designs
The benefits of cross-training will not be realized unless it is supported by:

A. Employee empowerment

B. Job rotation

C. Process improvement

D. Self-directed work teams
B. Job rotation
Which of the following would most likely be the focus of production activity control for a firm that manufactures high volumes of a narrow range of products?

A. Responding to changing priorities

B. Ensuring smooth flow of product

C. Ensuring that order dates are met

D. Increasing production efficiency
B. Ensuring smooth flow of product
Which of the following actions would provide the most significant advantage to a firm seeking to gain competitive advantage in delivery speed?

A. Extending the aggregate planning horizon

B. Employing pull signals

C. Reducing the number of product groups

D. Increasing the planning frequency
D. Increasing the planning frequency
As product variety increases:

A. Delivery reliability is more difficult to achieve

B. Product volumes also increase

C. The need for flexibility decreases

D. Quality becomes a qualifier
A. Delivery reliability is more difficult to achieve
The primary activities in a firms value chain are those that:

A. Interface with customers and suppliers

B. The customer is willing to pay for

C. Reflect the values of the organization

D. Deploy the assets of the organization
B. The customer is willing to pay for
Which of the following is the most important reason for establishing an alliance with another organization in the supply chain?

A. Leveraging the combined assets

B. Gaining entry into the partners markets

C. Improving the performance of both organizations

D. Reducing the total cost of acquisition
C. Improving the performance of both organizations
Understanding the total cost of ownership enables an organization to do which of the following?

A. Obtain lower puchase pricess

B. Focus on activities with the greatest return

C. Identify potential alliances to investigate

D. Reduce their ordering costs
B. Focus on activities with the greatest return
Collaboration among organizations in a supply chain can reduce the total inventory by:

A. Shifting the inventory to suppliers

B. Reducing the variability of end-user demand

C. Reducing the re-supply time

D. Increasing the speed of communications
C. Reducing the re-supply time
The purpose of the Supply Chain Operations Reference(SCOR) model is to :

A. Standardize business processes among supply chain partners

B. Test new supply chain concepts in multiple industry segments

C. Provide a baseline for measuring supply chain alliance members

D. Guide supply chain members for process improvements
D. Guide supply chain members for process improvements
Which of the following has contributed most towards making global sourcing and marketing practical for most industry segments?

A. Advances in transportation and communications

B. Rapid adoption of global standards

C. Consistent legal treatment of businesses
A. Advances in transportation and communications
The most significant impact of electronic business on supply chain management is:

A. Reduction of paper-based communications

B. Reduction of data capture costs

C. Coordination of information

D. Ease of global sourcing
C. Coordination of information
There is a direct correlation between which of the following in the supply chain?

A. Production throughput time reduction and delivery speed to the customer

B. Re-supply time and inventory levels

C. Ordering frequency and re-supply time

D. Batching work and the level of control
B. Re-supply time and inventory levels
The most difficult aspect of managing supplier relationships is:

A. Internal operations

B. Interpersonal relationships

C. Contractual requirements

D. Flow of information
B. Interpersonal relationships
Which of the following is most likely to cause an organization to establish production operations in an economic block?

A. Cultural differences

B. Legal requirements

C. Non-tariff barriers

D. Transportation and customs costs
C. Non-tariff barriers
Which of the following is most likely to be used to measure the success of a product design in an organization that employs sequential development steps?

A. the time from concept approval to general availability in the market

B. The project performance to budget

C. The number of engineering changes after the product is released

D. The cost to manufacture the product
B. The project performance to budget
Which of the following actions is most likely to reduce the total cost of a new generation product design and development project?

A. Create a cross-functional project team

B. Use less experienced designers and analysts

C. Reduce the project duration by overlapping activities

D. Defer Service considerations until late in the project
C. Reduce the project duration by overlapping activities
Which of the following is an example of cross-functional participation in a design and development project?

A. Establishing communications links between the firm's computer-aided design system and those of its key suppliers

B. Starting the process design activities before the release of the fianl product design documents

C. Considering the ease of manufacture and support as requirements of the product design activities

D. Involving key customers in major concept and detailed design reviews
D. Involving key customers in major concept and detailed design reviews
The house of quality is used in the quality function deployment processes to:

A. Translate what is required into how the requirements can be met

B. Capture the wants, needs and demands of the customer

C. Reduce the need for cross-functional teams

D. Defer technical decisions
A. Translate what is required into how the requirements can be met
Which of the following is a primary focus of the Taguchi methods?

A. Improving product quality through precise inspection

B. Translating customer requirements into design features

C. Identifying and controlling parameters that impact quality

D. Ensuring early manufacturing involvement in the design process
C. Identifying and controlling parameters that impact quality
Which of the following is most likely to determine the useful life of production equipment used to produce a high technology product line?

A. Legal limits

B. Generally accepted accounting practices

C. Life of the product line

D. Equipment warranty
C. Life of the product line
Which of the following methods is best aligned with a plant that produces a narrow mix of high-volume products?

A. Project costing

B. Job costing

C. Activity-based costing

D. Process costing
D. Process costing
When compared to external reporting, operational control requires actual cost data that is more:

A. Precise

B. Timely

C. Summarized

D. Comprehensive
B. Timely
Which of the following cost management methods is widely accepted for external reporting?

A. Activity-based costing

B. Full absorption accounting

C. Throughput accounting

D. Variable costing
B. Full absorption accounting
Which of the following inventory valuation methods will result in the highest inventory value in a time of rising cost?

A. Standard cost

B. Average cost

C. FIFO

D. Actual cost
C. FIFO
The primary objective of project management is to:

A. Meet the target date

B. Measure and report progress

C. Balance performance, time and cost

D. Ensure that all activities are completed
C. Balance performance, time and cost
The primary advantage of the discounted cash flow methods of evaluating capital investments is that they:

A. Incorporate the time value of money

B. Incoporate intangible benefits

C. Have fewer calculations

D. Are understood by operations personnel
A. Incorporate the time value of money
The Statement of Work (SOW) defines all of the following EXCEPT:

A. Reasons for the project

B. Initial and final customers

C. Measurable indicators of success

D. Contingency reserves
D. Contingency reserves
Evaluation of proposed investments solely in financial terms is most appropriate in which of the following situations?

A. Replacement of a machine with a similar one

B. Replacement of a machine with a new one with additional capabilities

C. Implementation of an organizational restructuring

D. Comparison of a capacity expansion and outsourcing
A. Replacement of a machine with a similar one
The work breakdown structure (WBS) should accurately reflect which of the following?

A. Task assignments

B. Project schedule

C. Work to be done

D. Contingency funding
C. Work to be done
The program evaluation and review technique (PERT) method of project scheduling is most appropriate when:

A. Duration of tasks is known

B. Tasks have a short duration

C. Confidence in time estimates is low

D. Number of tasks is large
C. Confidence in time estimates is low
A firm that evaluates projects independently is likely to overlook which of the following?

A. The rate of return on the projects

B. The learning potential of each project

C. The costs of required organizational change

D. The intangible benefits of the projects
B. The learning potential of each project
Which of the following is the most likely employee response when the target value for a measure that determines incentive compensation is easily attained?

A. The measure will be ignored

B. The employees will strive to just meet the target

C. The employees will strive to maximize their performance on that measure

D. The performance on that measure will be balanced with other measures.
C. The employees will strive to maximize their performance on that measure
National and international quality award and/or certification criteria provide an organization with:

A. A baseline for improvement

B. A benchmark for improvement

C. An industry standard for comparison

D. A mandated level of performance
B. A benchmark for improvement
An individual is most likely to be demotivated by a performance measure that:

A. Does not directly influence compensation

B. Has a target that is difficult to achieve

C. Is beyond his or her perceived influence

D. Is an indicator of process effectivness
C. Is beyond his or her perceived influence
Which of the following measures is most likely to encourage behaviour that improves delivery reliability in an organization that produces to customer order?

A. Master schedule conformance

B. Quoted lead times

C. Inventory levels

D. Total factor productivity
A. Master schedule conformance
The most important function of an effective performance measurement system is:

A. communicating

B. Evaluating

C. Inventory levels

D. Total factor productivity
A. communicating
Which of the following is best aligned with an effort to improve product mix flexibility?

A. Surge capacity

B. Rapid process improvement

C. Standardize operations

D. High level of automation
C. Standardize operations
Which of the following actions is most likely to concurrently improve product quality and reduce product cost?

A. Increasing the level of final inspection

B. Reducing indirect labor

C. Improving the planning system

D. Increasing component standardization
D. Increasing component standardization
Which of the following types of measures is LEAST likely to encourage cross-functional quality improvement efforts?

A. Cost of quality appraisal

B. Departmental scrap cost

C. Time between defect identification and correction

D. Product warranty clam and return rates
B. Departmental scrap cost
Reducing which of the following is most likely to improve both delivery reliability and delivery speed?

A. Queue times

B. Wait times

C. Degree of automation

D. Surge capacity
A. Queue times
An advantage of performance measures that are derived from cost management data is that the:

A. Cost of collecting data is minimal

B. Reporting is timely

C. Measures are easy to understand

D. Measures enable comparison with other organizations
A. Cost of collecting data is minimal
Which of the following is most likely to help an individual move from denying the need for change to accepting the change?

A. Telling him or her that the change is necessary

B. Identifying potential problems resulting from the change

C. Training him or her on the new procedures

D. Explaining the change and its effects
D. Explaining the change and its effects
The focus of process-level change typically is to:

A. Align choices with strategies

B. Employ continuous improvement to reduce waste

C. Exploit opportunities to meet customer needs

D. Understand the current state of the business
C. Exploit opportunities to meet customer needs
An organization converted its order entry process from a linear flow with each operation performed by a specialist to a team operation. Each individual is responsible for the order from receipt through customer acknowledgement. A small team of speclialists processes orders requiring special handling. The change was implemented to increase customer responsiveness and reduce the order-processing cycle time. The department personnel and other employees that would interface with the new process were trained on the new procedures and the department was physically rearranged to support the new procedures. New measures of cycle time for routine orders and for those requiring special handling were implemented. The chnaged procedures have been in use for 90 days.

The order entry supervisor was an active supporter of the change, but has expressed disappointment in the results because the average number of orders processed by each operator each day is lower that it was before the change.

Continuing application of the measure of average orders per operator per day indicates that the order entry supervisor is in which stage of change?

A. Denial

B. Resistance

C. Exploration

D. Commitment
B. Resistance
An organization converted its order entry process from a linear flow with each operation performed by a specialist to a team operation. Each individual is responsible for the order from receipt through customer acknowledgement. A small team of speclialists processes orders requiring special handling. The change was implemented to increase customer responsiveness and reduce the order-processing cycle time. The department personnel and other employees that would interface with the new process were trained on the new procedures and the department was physically rearranged to support the new procedures. New measures of cycle time for routine orders and for those requiring special handling were implemented. The chnaged procedures have been in use for 90 days.

The order entry supervisor was an active supporter of the change, but has expressed disappointment in the results because the average number of orders processed by each operator each day is lower that it was before the change.

Which of the following management actions would be most appropriate to guide the order entry supervisor forward?

A. Instruct him to stop using the performance measure

B. Change his title to order entry team leader

C. Promote him to a position in supply change manaement

D. Explain the inconsistency between the measure and the change
D. Explain the inconsistency between the measure and the change
An organization converted its order entry process from a linear flow with each operation performed by a specialist to a team operation. Each individual is responsible for the order from receipt through customer acknowledgement. A small team of speclialists processes orders requiring special handling. The change was implemented to increase customer responsiveness and reduce the order-processing cycle time. The department personnel and other employees that would interface with the new process were trained on the new procedures and the department was physically rearranged to support the new procedures. New measures of cycle time for routine orders and for those requiring special handling were implemented. The chnaged procedures have been in use for 90 days.

The order entry supervisor was an active supporter of the change, but has expressed disappointment in the results because the average number of orders processed by each operator each day is lower that it was before the change.

The actions of the order entry supervisor indicate that the change team did not adequately:

A. Identify the future state

B. Identify the transistion states

C. Communicate the goals and objectives

D. Communicate the effects of the change
C. Communicate the goals and objectives
An organization that is embarking on a significant change should ensure that the reward system encourages which of the following?

A. Innovation and prudent risk taking

B. Individual excellence

C. Focus on profitability

D. Proposal of small projects
A. Innovation and prudent risk taking
Which of the following is most likely to indicate that a process should be re-engineered or re-designed rather than incrementally improved?

A. A stable competitive environment

B. An expansion of the scope of the process

C. A large gap between customer requirements and performance

D. A hierachial and centralized organization structure
C. A large gap between customer requirements and performance
All of the following must be assessed in defining the future state of an organization EXCEPT:

A. Current state of the organization

B. Customers requirements

C. Likely competitive response

D. Steps to reach that state
C. Likely competitive response
Job or task-level changes are most appropriately defind by:

A. Functional management

B. Cross-functional teams

C. Workteams

D. Quality circles
C. Workteams
All of the following are characteristics of a leader EXCEPT:

A. Capability

B. Commitment

C. Credibility in the organization

D. Position in the organization
D. Position in the organization
An organization has one product line entering the maturity stage of its product life cycle. The sales volume is steady, but the firm's market share is moderate. The product line is manufactured to stock in a single facility using general purpose workstations that are organized in a functional layout. The production facility is shared with three other product lines. Each of the product lines places approximately the same demands on the production facility. The organization is considering the following actions:

Discontinuing the product line

Establishing dedicated capability for the line within the current facility

Adding a large number of options to the product line

Acquiring a distributor of the line to increase market share

Which of the actions is LEAST consistent with the stage of the product line life cycle and the organization's market share?

A. Discontinuing the product line

B. Establishing dedicated capability for the line within the current facility

C. Adding a large number of options to the product line

D. Acquiring a distributor of the line to increase market share
D. Acquiring a distributor of the line to increase market share
An organization has one product line entering the maturity stage of its product life cycle. The sales volume is steady, but the firm's market share is moderate. The product line is manufactured to stock in a single facility using general purpose workstations that are organized in a functional layout. The production facility is shared with three other product lines. Each of the product lines places approximately the same demands on the production facility. The organization is considering the following actions:

Discontinuing the product line

Establishing dedicated capability for the line within the current facility

Adding a large number of options to the product line

Acquiring a distributor of the line to increase market share

The largest risk of establishing a dedicated capability for the product line is that:

A. Production costs will be too high for the market

B. New production technologies will be required

C. Product mix flexibility will be too low for the market

D. The market will decline before the investment is recovered
D. The market will decline before the investment is recovered
A manufacturer of video cameras produces two families of products. One is a camera intended for the hobby market. This camera has only two models: an 8:1 zoom model and a 10:1 zoom model. These models come with identical features except for the lens. Sales for this line have been brisk and volumes have been high over the past five years.

The second line of video cameras consists of professional video cameras meant for the serious filmmaker. This line is very large with over 30 models, which are used for a wide variety of situations. The volume of these sales, as would be expected, is considerably less but each camera sells for a much higher price than do the hobby video cameras. Delivery for hobby cameras must be off the shelf: the professional cameras are made to order.

For the hobby cameras, the main focus of the production plan and resource requirements plan is:

A. Stable, full utilization production

B. Excess resources to support large growth

C. Extra capacity to allow for frequent engineering change

D. Stable finished goods inventory
A. Stable, full utilization production
A manufacturer of video cameras produces two families of products. One is a camera intended for the hobby market. This camera has only two models: an 8:1 zoom model and a 10:1 zoom model. These models come with identical features except for the lens. Sales for this line have been brisk and volumes have been high over the past five years.

The second line of video cameras consists of professional video cameras meant for the serious filmmaker. This line is very large with over 30 models, which are used for a wide variety of situations. The volume of these sales, as would be expected, is considerably less but each camera sells for a much higher price than do the hobby video cameras. Delivery for hobby cameras must be off the shelf: the professional cameras are made to order.

New production technologies that are introduced to manufacture the lenses for all of the cameras that the firm makes will likely require which of the following changes to the production plan and resources requirements plan EXCEPT:

A. New resource profiles

B. Different production rates

C. New capacity strategies

D. More frequent planning
D. More frequent planning
A manufacturer of video cameras produces two families of products. One is a camera intended for the hobby market. This camera has only two models: an 8:1 zoom model and a 10:1 zoom model. These models come with identical features except for the lens. Sales for this line have been brisk and volumes have been high over the past five years.

The second line of video cameras consists of professional video cameras meant for the serious filmmaker. This line is very large with over 30 models, which are used for a wide variety of situations. The volume of these sales, as would be expected, is considerably less but each camera sells for a much higher price than do the hobby video cameras. Delivery for hobby cameras must be off the shelf: the professional cameras are made to order.

For the professional cameras, rough-cut capacity planning will probably be most concerned with:

A. Bottleneck work centers

B. Capacity balancing for the line

C. High levels of utilization

D. Resource profiles
A. Bottleneck work centers
A manufacturer of video cameras produces two families of products. One is a camera intended for the hobby market. This camera has only two models: an 8:1 zoom model and a 10:1 zoom model. These models come with identical features except for the lens. Sales for this line have been brisk and volumes have been high over the past five years.

The second line of video cameras consists of professional video cameras meant for the serious filmmaker. This line is very large with over 30 models, which are used for a wide variety of situations. The volume of these sales, as would be expected, is considerably less but each camera sells for a much higher price than do the hobby video cameras. Delivery for hobby cameras must be off the shelf: the professional cameras are made to order.

For the hobby camera market, the material requirements plan is most likely to:

A. Be rate based

B. Be job-order based

C. Focus on end product

D. Have discrete lot sizes
A. Be rate based
What are the four major types of functional strategies that support the coporate strategy and business strategy?
Financial strategy

Product Development strategy

Operations strategy

Marketing strategy
Which of the following business strategy approaches can a business use to competitively distinguish itself?

I. Price leadership
II. Operations leadership
III. Product differentiation
IV. Customer focus

A. I and II
B. II and III
C. I, II and IV
D. I, III and IV
D. I, III and IV
What are the four elements of Operations Strategy?
1. Method for evaluating the impact of activities

2. Definition of time dimensions
-Time Horizon
-Time Fences

3. A mechanism for integrating decisions

4. Transformation efforts
Strategy Development Approaches
Overview approach

Trade-off approach

Reductionist approach

Sequential approach

Pg 1-17
Overview approach
Overview approach

Identify several core strategic focuses

Make a checklist

Focus on one or two issues
Strategy Development Approaches

Trade-off approach
Strategy Devlopment Approaches

Trade-off approach

Identify most important variables and contributing factors

Identify interaction and possible impacts
Strategy Development Approaches

Reductionist approach
Identify root causes

Reduce effects
Strategy Development Approaches

Sequential approach
Strategy Development Approaches

Sequential approach

Address competitive priorities one at a time

Build upon foundation priority

pg 1-17
Marketing Strategy
Determining the market segment plan

Developing market niches

Completing a competitive analysis

Increasing market share

pg 1-25
Determining the Market Segment Plan
Determining the Market Segment Plan:

Select the product market area

Identify the needs of potential customers

Match needs with market segment characteristics

Profile each segment

pg1-25
Definition of manufacturing operations strategy
A collective pattern of decisions that acts upon the formulation and deployment of manufacturing resources. To be the most effective, the manufacturing [operations] strategy should act in support of the overall strategic direction of the business and provide for competitive advantages (edges).

pg 1-27
Plans to be included in the Operations strategy
Plans to be included in the Operations strategy:

Critical Skills Plan
Facilities Plan
Process Plan
Unit capability Plan

pg 1-29
Operations strategy - Critical Skills Plan
Operations strategy - Critical Skills Plan:

Identify and evaluate resource commitments and fit them into organization domains such as skills, knowledge and tasks.

*May be the most important source of competitive advantage in the coming decades

pg 1-29
Operations strategy - Facilities Plan
Operations strategy - Facilities Plan:

Must include all actual properties of the company

Must integrate operations, distribution and service delivery activities

The four components are:

-size and structual design
-location
-layout
materials handling systems
Operations strategy - Process plan
Operations strategy - Process plan:

By documenting processes, the firm can more easily identify glitches and errors in new systems. Flowcharts are often very helpful

pg 1-29
Operations strategy - Unit Capability Plan
Operations strategy - Unit Capability Plan:

Evaluation of current organizational capacities to meet existing and future strategic needs

consideration involving the supply chain for future needs including supplier capabilities, production capabilities and distribution capabilities.

Options include considerations for capital projects as well as the reallocation of excess capabilities/resources.

pg 1-29
Characteristics that create a competitive advantage
Characteristics that create a competitive advantage:

PRICE

QUALITY

DELIVERY SPEED

DELIVERY RELIABILITY

FLEXIBILITY

PRODUCT DESIGN - TECHNOLOGY, FEATURES/OPTIONS,RANGE

SERVICE - AFTERSALE AND INTERNAL
Competitive advantage categories
Competitive Advantage Categories:

ORDER WINNERS: Characteristics that make your customers prefer you over competitors

QUALIFIERS: Characteristics you need to get into the game

NON-ISSUES: Characteristics the do nor=t enter into the competitive picture for that market niche

pg 1-34
Quality Cost Categories
Quality Cost Categories:

INTERNAL FAILURE COSTS - costs associated with defects, such as errors or nonconformance, that are found before delivery of the product to the customer

EXTERNAL FAILURE COSTS - Costs associated with defects found after the product is shipped

APPRAISAL COSTS - Costs incurred in determining the degree of conformance to quality requirements (non-value added costs)

PREVENTION COSTS - Costs incurred in keeping failure and appraisal costs to a minimum (value-added costs)
Operations Strategy Choices - Structure Decisions
Operations Strategy Choices - Structure Decisions incude:

ORGANIZATIONAL STRUCTUAL DESIGN

CAPACITY STRATEGIES

FACILITIES STRATEGY

TECHNOLOGY
Operations Strategy Choices - Infrastructure Decisions
Operations Strategy Choices - Infrastructure Decisions include:

ORGANIZATIONAL INFRASTRUCTURE DESIGN

WORKFORCE INVOLVEMENT

OPERATION SYSTEMS CONFIGURATION
Definition of Volume and Variety
Definition of Volume and Variety:

PRODUCT VOLUME: Refers to the overall quantities of a particular product or product family in a market niche

PRODUCT VARIETY: Refers to the number of end items that are possible for a product or product family

pg 2-12
Product Grouping Questions
Product Grouping Questions:

What are the firm's overall strategy and marketing strategy?

What market niches are being served?

What products are being sold into those niches?

What are the order winners and qualifiers for products in each niche?

What are the current and expected volumes and vaieties for products in each niche?

How will the company create product groupings?

What are the manufacturing strategies for each product grouping?

pg 2-17
Questions at Introduction Phase
Questions at Introduction Phase:

What product or service will be offered?

What is the design of the product or service

What is the expected market for the product or service?

What volume and process capacities are required?

What level of process technology is appropriate?

What types of equipment and labor force should be selected?

How should the production or service delivery system be organized?

What information system should be chosen?
The Maturity Phase
The Maturity Phase:

Market demand is high - Volume is at its peak

Variety is usually small and stable

Competition is based on consistent delivery as well as cost

Questions to ask at maturity phase:

What process efficiencies are necessary?

What product or service features are required?

What market repositioning is appropriate?

What follow-on product or service should be considered?
The Decline Phase
The Decline Phase:

Variety added to the product to extend its life

New features and options as well as product extensions, cause variety to increase dramtically while volume per end product is correspondingly reduced.

Price becomes key competitive advantage among competing survivors

Questions at Decline Phase:

What is the salvage value of the facility?

How much repair parts stock should be produced?

How can the effects on employees be minimized?

What are the long range responsibilities for the product or service, process technology and production system residues?
Capacity Strategies
Capacity Strategies:

LEAD STRATEGY: Capacity is added in anticipation of increased demand

LAG STRATEGY: Capacity is added only after demand increases are well known

TRACKING STRATEGY: Capacity is added in small increments to follow demand patterns closely

pg 2-38
Cellular Layout
Cellular Layout:

A cell is a manufacturing unit consisting of a number of workstations plus the material transport mechanism and storage buffers to interconnect them.

Produces families of parts within a single line or cell.

C-shaped or U-shaped cells work best

Breaks-up functional clusters into cells

Equivalent to creating minniature flow-lines

pg 2-59
Group Technology
Group Technology:

Identifies similarity of manufactured parts

Establishes common routings

Classifies Parts by:
-size
-Geometry
-Function

Facilitates cellular layout
Group Technology Advantages
Group Technology Advantages:

Space savings
Less WIP
Lead-time reduction
Visibility and immediate feedback
Better Quality
Minimal travel distance
Less material handling

pg 2-61
Scope of Productivity
Scope of Productivity:

Infrastructure decisions of the firm are centered on three major categories:

WORKFORCE INVOLVEMENT: Number of people, types of people, degrees of skill, degrees of empowerment

ORGANIZATIONAL DESIGN: Vertical or horizontal, centralized or decentralized, matrix, number of levels

OPERATION SYSTEMS CONFIGURATION:

-Quality systems: Inspection degree, type and frequency; process capability; type os control; interaction with design; employee participation; top management support

-Manufacturing resource planning: Manufacturing resource planning (MRP II), just in time (JIT), order point, purchasing systems, forecasting, demand management, distribution systems

-Information systems: Types of information, degree of access, degree of technology, types of reports

pg 3-9
Cross Functional Work Teams
Cross Functional Work Teams:

Involves workers from different departments

Assembled to solve major, company-wide problems

Uses standard problem-solving and project management techniques

pg 3-18
Self-Directed Work Teams
Self-Directed Work Teams:

Generally a small, independent, self-organized and self-controlling group in which members flexibly plan, organize, determine and manage their duties and actions, as well as perform many other supportive functions. May work without immediate supervision and can often have authority to select, hire, promote or discharge its members.

Advantages include improvements in productivitiy, quality, customer satisfaction and cost as well as commitment of personnel.

pg3-21
Objectives of Education
Objectives of Education:

Transfer of facts
Understanding of the message
Change in behavior
Implementation of new techniques/ideas
Line accountability
Peer confirmation
Continuing reinforcement
Credibility
Enthusiasm

pg 3-24
The Critical Mass
The Critical Mass:

The critical mass can best be described as the "VALUE ADDERS". These individuals add value to the product by working directly on material and parts or by providing a service to the customer

pg 3-29
Organizational Design
Organizational Design:

Refers to the features and linkages of the organization
A process consisting of a number of related steps, with each step adding a certain value to the total outcome:

A. Process chain

B. Market strategy

C. Value chain

D. Organizational functions
C. Value chain
Which of the following are steps in the value chain?

I. Raw Material
II. Customer
III. Supplier
IV. Technology
V. Finance
VI. Marketing

A. I, II, & III
B. I, II, IV & VI
C. II, III, IV, V
D. III, IV, V & VI
B. I, II, IV & VI
Steps in the value chain
Steps in the value chain:

Raw material
Technology
Manufacturing
Logistics
Marketing
Sales
Customer
Supply chain management (SCM)
Supply chain management (SCM) includes:

Management of information systems
Sourcing and procurement
Production scheduling
Demand fullfillment
Cash Flow
Inventory management
Warehousing
Customer service
After-market disposition of packaging and materials
Market/Industry Analysis Characteristics
Market/Industry Analysis Characteristics:

The suppliers who tend to give the best competitive advantage tend to have the following characteristics:

They are defect free
They are just in time
They use internal (supplier) engineering resources
They provide the best total cost for the company
They provide inspected material
They have the best new technology and innovation cycles
They are generally first in the marketplace with new improvements
The art and science of obtaining, producing and distributing material and product in the proper place and in the proper quantities

A. Purchasing

B. Production

C. Logistics

D. Customer Service
C. Logistics
Refers to keeping inventory in specified locations on a plant floor near the operation for which it is to be used. Allows for easier access to material as well as inventory management through visibility

A. Point of manufacture storage

B. Warehouse Storage

C. Point of use storage

D. Containerization
C. Point of use storage
Can be used to store materials as they move between supplier and customer.

A. Point of manufacture storage

B. Warehouse Storage

C. Point of use storage

D. Containerization
B. Warehouse Storage
Means delivering inventory directly to the work cell that is going to be using the material in the sequence in which the material will be utilized. Greatly reduces material handling time and allows for effective use and storage of material with little wait time.

A. Point of manufacture storage

B. Warehouse Storage

C. Point of use storage

D. Containerization
A. Point of manufacture storage
A material movement method in which commodities are placed in containers. After initial loading, the commodities are not rehandled in shipment until they are loaded at the destination.

A. Point of manufacture storage

B. Warehouse Storage

C. Point of use storage

D. Containerization
D. Containerization
The length of time from when a material enters a production facility until it exits

A. Process time

B. Value time

C. Quality time

D. Cycle time
D. Cycle time
Reviews performance measures for continuous improvement

Links the strategic plans for the business with execution

Considers the near to immediate term

Ties to the business plan

A. Operation strategy

B. Production Plan

C. Sales and Operations Planning

D. Corporate Strategy
C. Sales and Operations Planning
Supplier evaluations
Supplier evaluations:

Facilitate communication
Set far-reaching but achievable gols
Direct attention to critical weaknesses
Set expectations for acceptable and superior performance
Create an audit trail
Document suppliers performance over time
Planner/Buyer or Supply Analyst's Role:
Planner/Buyer or Supply Analyst's Role:

Be familiar with the market/industry analysis

Use value chain mapping effectively

Understand critical standards of measure

Be able to calculate the total cost of ownership

Implement the best information systems

Manage inventories

Establish and maintain trust between parties

Manage conflict over contractual issues
Global sourcing and distribution
Global sourcing and distribution:

Costs
Time variations
Cultural diversity
International regulations
Currency fluctuations
Global logistics system
Characteristics of a project
Characteristics of a project:

-Numerous sequential and interrelated activities
-Unique set of events
-Finite with a beginning and end date
-Limited resources and budget
-Many people are involved
-Goal-oriented
-End product or service must result
Project Life Cycle
Project Life Cycle:

Plan, Implement and Closeout

Cost and staffing are low at the start, higher towards the end and drop rapidly as the project draws to conclusion

At the beginning, risk and uncertainty are highest and the probability of successfully completing is lowest

Probability of successful completion gets progressively higher as the project continues

the cost of changes and error correction generally increases as the project continues
Project Director/Leader
Project Director/Leader:

Runs interference
Serves as mediator for organizational issues
Negotiates with project manager on phases to be used on project and associated criteria
Helps with details of WBS (Work Breakdown Structure)
Demonstrates effective leadership
Conducts project reviews
Recruits resources
Supports the project manager
Project Manager
Project Manager

Has the ULTIMATE accountability and responsibility for a projects success or failure.
Role of the customer in project management
Role of the customer in project management:

Has ultimate approval for project sign-off

Establishes requirements

Decides where changes must occur

Requires CONSTANT communication

Develops communication plan

Is involved in determining scope
Traditional Capital Justification Weaknesses
Traditional Capital Justification Weaknesses:

Encourages a short term outlook
Assumes project-by-project analysis
Ignores competitive impacts
Fails to consider learning potential
Encourages major projects
Detracts from "Building blocks" of smaller projects
Limits involvement of operations
Requires staff specialists
Project Planning Phase
Project Planning Phase:

Statement of Work (SOW)

Work breakdown Structure

Project schedule

Responsibility matrix

Resource requirements

Budget
Key cost components of the project budget
Key cost components of the project budget:

Labor costs

Material costs

Equipment costs

Vendor/consultant costs
Project Contigency Reserve
Project Contigency Reserve:

covers such things as:

Weather delays

changes in design

Unforseen price increases

Estimating errors

Other projects risks
Effective Leaders
Effective Leaders:

Are proactive
Begin with the end in mind
Put first things first
Think win-win
Seek first to understand then to be understood
Seek synergies
Sharpen the saw
Are results driven
Are good communicators
Maintaining the schedule and budget
Maintaining the schedule and budget:

Track Progress

Detect variance form plan - both favorable and unfavorable

Take corrective action
The Project Closeout Meeting
The Project Closeout Meeting:

Review project statement of work

Review actual deliverables and show how the project met its measurable success indicators

Summarize what was done well

Identify areas for improvement

document recommendations or "lessons learned" to aid future projects.

Determine if there are any further tasks to be completed
Implementing Change Requirements
Implementing Change Requirements:

Aligning:

-processes and procedures
-roles and responsibilities
-organizational design
-measurement system
Educating and training
Transforming an Organization
Transforming an Organization

Steps in the change process:

1. Establish a sense of urgency

2. Form a guiding coalition

3. Create a vision

4. Communicate the vision

5. Empower others

6. Create short-term wins

7. Consolidate improvements

8. Institutionalize new approaches
Leading Cultural Change
Leading Cultural Change

Communicate to the employees that change is necessary

Encourage employees to get involved

View the entire organization as a team

Implement suggestions rapidly

Break down walls that inhibit communication

Give employees a sense of mission

communicate positive and negative business results